The Power of People Analytics in the Modern Workplace

28 Aug The Power of People Analytics in the Modern Workplace

We’re fortunate to live in a time when it’s easier than ever to understand what motivates people to make decisions.

And it’s “big data” that we have to thank for it.

With more than half the world’s population now online, there’s unprecedented access to the habits, preferences, and processes that drive people. Most companies know who you are, what you like, and what it takes to get you to make a purchase.

And that’s why it comes as no surprise that to-date, big data’s primary role has been in the worlds of marketing and sales.

But what about the application of big data in HR?

If our marketing teams can leverage data to understand what drives leads to become customers, HR leaders can use similar data to convert candidates into employees.

I’m talking about the growing field of “people analytics”: a data-driven approach to how HR leaders can hire smarter, retain employees, and create a better overall employee experience.

And in this post, I’m sharing a few big ways you can begin taking advantage of people analytics for your HR team.

3 Ways Big Data in HR Will Make Your Company Better

HR leaders are always on the hunt for new ways to improve the efficiency and effectiveness of their organizations.

While 78 percent of large companies say people analytics is an “urgent” priority for their business, only 7 percent believe they have the capability to make it happen.

And with that in mind, these three strategies for bringing people analytics into the fold are the latest way HR leaders can take their organization to the next level:

#1. Uncover Your Most Valuable Talent

For most companies, the recruiting process goes something like this…

A hiring manager approaches the HR team with an outline of what they’re looking for in candidates for an open requisition.

The HR team then searches for those candidates. Unconscious bias inevitably bleeds in.

Then, candidates get screened and interviewed based on the hiring manager’s preferences — not any hard data associated with performance.

It’s the way most companies hire, but when it’s laid out like that, there’s some pretty obvious flaws, right?

People analytics have the power to change that.

By actually measuring and quantifying the long-term value of employees based on their degrees, schools, previous companies, and experience level, HR leaders can make intelligent hires that transcend biases and have a higher likelihood of adding value to an organization.

And there’s data to back it up:

According to one study, algorithmic hiring resulted in 7 percent higher supervisor ratings of new hires, 4 percent more promotions, and a whopping 11 percent higher ability to learn from training versus candidates hired based on a hiring manager’s “instinct.”

“What [companies] need…is a way not just to see what happened, but to understand why it happened, what will happen next, and how to adapt their workforce strategy to align with company objectives.”

NPS surveys and exit interviews with employees leaving your company can offer information. But collecting that data takes time — in today’s competitive talent marketplace, most companies need help with retention today.

Which is why HR leaders should take a page from Nielsen’s playbook on people analytics for reducing attrition rates.

Rather than spending time collecting and analyzing new data points, Nielsen looked at what they already knew about they’re employees.

They compared data on employee ages, genders, experience levels, commute times, tenure, and manager ratings to figure out what made people stick around at their company.

And they found some interesting trends for their organization, including this one:

“You can generally assume that your employees want the tools, knowledge and resources to do their jobs in the best way possible. It’s up to you to figure out how to equip them with exactly what they need. This is the crux of the argument for analytics. If you can understand where your investments are working (and where they aren’t), you have targeted intelligence to give your people exactly what they need, when and where they need it, in a format that makes it as easy as possible for them to take advantage of it.”

In other words: people analytics tell you what training works, who needs it, and the easiest ways to deliver it to your employees.

In turn, you end up with more engaged, more productive teams who can offer the maximum possible value to your organization.

Now It’s Your Turn…

People analytics are becoming a bigger part of how HR leaders make decisions about hiring and developing talent.

But there are certainly other applications of big data in HR that were not covered in this post.

How are you leveraging data to change the way your HR team operates? What’s working? What’s not?

Blue Rock Search

Blue Rock Search is a member of the Sanford Rose Associates network of offices.

Sanford Rose Associates®”, the three-diamond “SRA” logo, “Dimensional Search®” and “Finding People Who Make a Difference®”, are all registered service marks of Sanford Rose Associates International, Inc., a Texas corporation.